Interest cost, forex losses weigh on Bharti's Q2 numbers

Moneycontrol Bureau

The country's largest telecom firm Bharti Airtel on Friday posted a 38.17% fall in second quarter consolidated net profit to Rs. 1,027 crore year-on-year due to higher interest outgo and costs related to the roll-out of its 3G network.
Interest expenses trebled from a year earlier to Rs 1,118 crore for the September quarter denting profits.
The Sunil Mittal led company said the roll-out of its 3G network resulted in a higher amortisation cost of Rs 164 crore for the quarter, while its net interest cost rose to Rs 115 crore during the reporting period.
Bharti had to take on debt to pay more than USD 3 billion for 3G and broadband spectrum in a state auction last year. Currency fluctuations led to foreign exchange losses of Rs 239 crore for the quarter versus profit of Rs 249 crore in the year ago quarter.
Meanwhile, the company's overall customer base stood at 237 million across 19 countries. Also its monthly average revenue per user (ARPU), a key metric for telecom carriers, from Bharti's Indian operations fell to Rs 183 during the reporting quarter from Rs 190 in the June quarter. Average usage per user also declined to 423 minutes at the end of the September quarter from 445 minutes in the June quarter this year.
However, Africa operations boosted the overall performance of the company.
"Africa has notched up strong revenue growth of 23% at USD 1030 million. The company has launched 3G services in Congo B and Airtel Money in Zambia and Kenya" said Sunil Mittal, chairman, Bharti Airtel who further added,